December Comex Gold futures are trading lower, pressured by a slight recovery in the U.S. Dollar Index. Position-squaring ahead of Wednesday’s Federal Reserve monetary policy decision and President Trump’s selection of the next Fed chair on Thursday are also weighing on prices.
Daily Technical Analysis
The main trend is down according to the daily swing chart. However, last Friday’s closing price reversal bottom and subsequent follow-through rally has helped shift momentum slightly to the upside.
Today’s inside move suggests investor indecision and impending volatility.
A trade through $1263.80 will negate the closing price reversal bottom and signal a resumption of the downtrend. This could send the market into the next main bottom at $1262.80.
On the downside, the nearest support is a major Fibonacci level at $1268.90.
On the upside, the best resistance is a price cluster at $1286.10 to $1286.80. Since the main trend is down, sellers are likely to come in on a test of this area.
Daily Forecast
Based on the early price action and the downside bias, the first target today is an uptrending angle at $1271.30. This is followed by the major Fibonacci level at $1268.90.
If $1268.09 fails as support then we could see a drive into $1263.80 then $1262.80.
If $1271.30 holds as support then this may generate enough upside potential to challenge the next uptrending angle at $1279.80. Overtaking this angle could trigger an acceleration into a resistance cluster at $1286.10, $1286.40 and $1286.80. This is the best upside target and strongest resistance area.